Elston emerges as newest retail hub

Elston Avenue, the once-gritty, industrial North Side corridor, is the latest front in the retail suburbanization of the city.

Superstore retailers first staked their claims on Elston about 10 years ago. Now, a second wave of retail activity is swelling, reflecting the gentrifying neighborhoods to the west and spillover from the crowded Clybourn Corridor.

Elston, a diagonal strip just west of the Chicago River that used to be home to tanneries, fish wholesalers and construction yards, is now dominated by Target, Circuit City and Pep Boys.

"The cat is out of the bag on our block of Elston," says Alfred Klairmont, president of Imperial Realty Co., which plans to sell 3.5 acres on the street to Home Depot Inc. "I think there's no question the highest and best use for this area is retail."

Elston's first shopping center, which opened in 1986 at Logan Boulevard, has been re-leased over the last two years, mostly to new tenants, including PetsMart, Jo-Ann Fabrics, Great Ace, Harlem Furniture and Micro Center, a computer store.

Atlanta-based home improvement giant Home Depot plans to build its store on the 2500 block of North Elston, where a former CNA Financial Corp. records storage warehouse stands.

Also, sources say that Danish furniture/housewares retailer Ikea is eyeing a site for its second Chicago-area store just north of Armitage Avenue  a vacant lot where a paint factory once stood.

The Elston area is viewed as a successor of sorts to the mostly built-out Clybourn, home to trendy retailers such as Crate & Barrel and the Container Store, serving Lincoln Park residents.

Now, retailers are seeking the next corridor, although Elston so far has landed mostly discounters.

"The neighborhoods to the west of Elston have changed, and the street is not as congested as Clybourn, so Elston should be primed to replicate at least some of the success that Clybourn has had," says Neil Stern, a partner at Chicago-based retail consulting firm McMillan/Doolittle LLP.

Like Clybourn, Elston offers retailers enough land for big stores with ample parking. Retailers also like the easy access and good traffic flow on Elston, the visibility from the Ken-nedy Expressway and the proximity to affluent residents of Lincoln Park, Lakeview and gentrifying Bucktown and Logan Square.

Brian Daly, president of Great Ace Inc., relocated his store from Clybourn to Elston about 18 months ago, in part to escape parking and traffic problems.

Another Clybourn?

"Clybourn is crippled. People who live in the area avoid it on the weekends because the traffic is so bad," he says.

However, some are concerned that Elston will become another Clybourn. They lament the creeping strip centers  no charming storefronts here  and the accompanying noise and congestion. Others still mourn the loss of the street's manufacturing jobs, although some facilities remain, such as Vienna Sausage Manufacturing Co.

"I like the idea of the traffic a Home Depot would bring, and I don't like it. Elston and Fullerton/Damen is already a tough intersection," says Alan Schwartz, chairman of Chicago-based Tennis Corp. of America, which operates the Mid-Town Tennis Club at Elston and Fullerton avenues.

Despite the strip mall that opened in 1986, anchored by a Handy Andy and Cub Foods, retail didn't explode on Elston as it had on Clybourn. The center was slow to fill with stores in the late 1980s and suffered a major setback in the mid-'90s, when a spate of retail bankruptcies forced the closings of Handy Andy, Discovery Zone and Silo electronics superstore.

Now fully leased, the center is adding 5,600 square feet, says Mark Rashkow, director of operations at Mid-Northern Equities Ltd. of Northbrook, which developed the center. Mr. Rashkow says he is in lease negotiations with an optical chain, hair salon and beauty products store for the expanded center.

"When we first built the center, it was extremely difficult to lease it," says Mr. Rash-kow. "Urban retail hadn't caught on yet, and we had our hardships. Today, we wish we had twice the space."

Mr. Rashkow says retailers are particularly attracted when they hear about the success of Target  which opened across the street in 1993 and is undergoing its second expansion  and nearby Circuit City. Both stores are near the top of their respective chains in sales volume, sources say.

More retail inevitable

Advocates for the manufacturing community say that, like Clybourn, Elston has lost too much industry already.

"It's a shame, because the manufacturing companies that were displaced were not provided other spaces in the area," says Carl Bufalini, president and CEO of the North Business and Industrial Council, an advocate for North Side industrial companies. "That's where government and the (city) Planning Department should step in."

But more retail development is inevitable, particularly as retail rents continue to climb, says Mr. Klairmont of Imperial Realty.

"Can you blame (Home Depot, Ikea and other large retailers) for looking here?" he says. "Their shoppers are right in (Elston's) backyard."